How do we know what is an appropriate HR model for a firm?

Best Practice Model
! Argument: all firms will see performance improvement if best practice
implemented (see empirical evidence)
! Method: identify best practice, give HR a high profile, get top level
commitment, sell it, do it, measure it, reward champions
! Advantage: much agreement / tradition on basic best practice. Also
recognition of ‘bad’ practice. Established rules of thumb for selection;
training; appraisal methods. No need to re-invent. It’s out there.
! Disadvantage: difficulty arises when we go beyond these
straightforward practices. There is great diversity of ‘best practice’
which moves away from uniformity. Pfeffer(1994 listed 16 practices
for ‘competitive advantage through people’. Danger of becoming an
end in itself at the expense of company goals / interests. Can be
conflict between benefit to company & benefit to worker ie reengineering & downsizing. Employees may lose their voice. May not
be appropriate in all situations or even in sections of same business.

High Performing Work Systems (HPWS)
High Involvement
! Ability – enhance employee ability
& knowledge through good recruitment
& training
! Motivation – motivate desired
behaviours through strong incentives
! Opportunity – encourage ideas &
contribution from motivated & better
trained workers
Characteristics of Best Practice Model:
Work teams~ flexibility
2-way information ~ comms
Care with recruitment ~selection
Traits / Behaviours ~ not skills
Fair appraisal ~ reward
Involved in decision making
Emphasis @ training ~ learning
Individual development

Empirical Evidence that HRM is associated with performance
- Guest - Future of Work (2001)
“High commitment management practices
are associated with better economic
performance, better workplace well-being
and a better climate of employment
relations but just 14% of all workplaces
have a majority of them in...

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